The Gathering Storm in Post-Decree Family Law Litigation, 0719 COBJ, Vol. 48, No. 7 Pg. 26
| Author | BY JOHN H. TATLOCK |
| Position | Vol. 48, 7 [Page 26] |
FAMILY LAW
BY JOHN H. TATLOCK
Two 2018 Colorado Court of Appeals opinions present starkly different interpretations and applications of CRCP 16.2(e)(10). This article discusses the opinions and the rule to inform practitioners on navigating this area pending resolution of this case conflict.
On February 1, 2018, a divided panel of the Colorado Court of Appeals announced its decision in In re Marriage of Runge.1 In three separate opinions—majority, special concurrence, and dissent—the panel held that the district court correctly determined that the appellant-wife failed to allege a sufficient basis for a reallocation of allegedly misstated or omitted marital assets under CRCP 16.2(e) (10) (the Rule). Concluding that the Rule is "extraordinary and also very narrow,"2 the panel also concluded that its plain language did not permit a party to conduct post-decree discovery into a former spouse's assets. The special concurring opinion also addressed a related jurisdictional issue, whether the trial court has jurisdiction to decide a timely filed motion under the Rule after expiration of the Rule's five-year jurisdictional period, and concluded that once a court acquires jurisdiction, it retains that jurisdiction through the occurrence of all subsequent events, including the arrival of the five-year deadline.3The dissenting opinion disagreed, interpreting the Rule's five-year jurisdictional limit as an absolute, plain-language bar on any further judicial action.4
More than seven months after Runge, a separate panel of the Court of Appeals issued its ruling in In re Marriage of Durie, holding that a party filing a CRCP 16.2(e)(10) post-decree motion for reallocation of misstated or omitted marital assets may allege in the motion facts that are based upon "information and belief," and may conduct appropriate discovery under the Rule to support the post-decree motion and resulting litigation.[5] This expansive interpretation and application of the Rule directly conflicts with the Runge holding that CRCP 16.2(e)(10) is an "extraordinary and very narrow" remedy. And it authorizes open-ended factual allegations t hat warrant extensive post-decree discovery of the other party, also contrary to the panel's holding in Runge. To further complicate the situation, another case pending before the Court of Appeals, In re Marriage of Laurnen,6 asserts that the Rule's five-year jurisdictional limit does not constitute an absolute bar to judicial action if a party files a motion to extend that time period, even on the last day of the fifth year.
Taken together, this trio of decided and pending Court of Appeals opinions cannot be easily reconciled. In fact, the Lawmen appellant has asserted that the Court of Appeals panel's holding in Durie could have been applied to overrule the Runge division's conclusion that wife's "suspicions and speculations" could not adequately support a CRCP 16.2(e)(10) reallocation motion.7
Parties, counsel, and trial courts will likely confront motions asserting the controlling authority of Runge, Durie, or some combination of both in post-decree litigation brought under the Rule. Until dispositive case law resolving these apparently contradictory authorities is issued, practitioners must proceed on uncertain ground. This article discusses the Rule and its interpretations in these cases to inform practitioners on how to navigate their cases in the face of this ambiguity.
The Architecture of CRCP 16.2(e)
CRCP 16.2(e)(10) is the exclusive post-decree remedy for parties in a domestic relations case to challenge a property division and allocation, and the viability of a motion brought under the Rule depends on its compliance with the Rule's other provisions.
The Duty to Disclose
Pursuant to CRCP 16.2(e)(1), the parties in a domestic relations case owe a duty to each other and to the court to make "full and honest disclosure of all facts that materially affect their rights and interests and those of the children" in each case brought before the court. Fulfilling this comprehensive duty requires each party to "affirmatively disclose all information that is material to the resolution of the case without awaiting inquiry from the other party."8This voluntary disclosure obligation is coupled with the affiliated duty of mutual and reciprocal candor that a domestic relations party must meet.9
The Required Disclosures
These professional and legal duties materialize in CRCP 16.2(e)(2), which requires each party in a family law case to provide the specific disclosures contained in the Appendix to Chapters 1 to 17A of the Colorado Rules of Civil Procedure. Those mandatory disclosures are set forth in Forms 35.1 through 35.3 of the Rules of Civil Procedure and the Appendices to those Rules. In addition, again without the need for a discovery request from the other spouse, CRCP 16.2(e)(3) requires the disclosing party to provide "a list of expert and lay witnesses whom the party intends to call at a contested hearing or final orders." Under CRCP 16.2(e)(4) to (5), all parties subject to these disclosure obligations must supplement or amend any prior disclosures according to the terms of CRCP 26(e) and may be subject to sanctions for failure to timely provide these disclosures, presumably including any required supplementations.
Effect of the Disclosures
CRCP 16.2(e)(7) requires each party completing and serving the mandatory disclosures to accompany the service with a certificate, also filed with the court, attesting that to "the best of the [party's] knowledge, information, and belief, formed after a reasonable inquiry," the disclosures are "complete and correct as of the time [they are] made," unless specifically noted in the certificate. In general, service and filing of the certificate signals the end of the disclosure phase of the case, and either the beginning or continuation of the discovery phase, which is governed and directed according to CRCP 16.2(f) and applicable trial court orders.
No reported Colorado opinion identifies any legal significance to a party's certificate of compliance, for example, a presumption that the certificate shifts the burden of demonstrating noncompliance with the CRCP 16.2(e) (1) disclosure obligation to the other spouse, although that may be the practical effect of each party's certification. To the extent either party believes the other party may have provided incomplete or inaccurate disclosures, formal and informal discovery conducted on the other party or selected non parties allows the parties to test the sufficiency of the disclosures and to explore other aspects of the marital assets and liabilities in greater scope and intensity. With the close of discovery, and subject to each party's continuing duty to supplement disclosures and discovery responses, the content of the marital estate is essentially fixed, pending evidentially revelation at hearing or trial.
Applying CRCP 16.2(e)(10): The Scope of Relief
CRCP 16.2(e)(10) is a mere 122 words, but it is the sole and exclusive post-decree remedy available to either party in a domestic relations case to identify and attempt to correct inaccuracies in the other party's mandatory financial disclosures. Despite the myriad other post-decree motions that can be heard in a trial court (e.g., motions to modify parenting time, decision-making, maintenance, or child support, or to restrict or terminate parenting time), CRCP 16.2(e)(10) is intentionally limited to correcting errors in a party's financial disclosures. To underscore the point, Colorado courts have held that even the adjustment of assets and debts within a marital estate under the Rule does not empower a district court to also modify maintenance and child support or other financial allocations in its permanent orders or the parties' separation agreement; in In re Marriage of Dadiotis, the Court of Appeals stated, "[B]ecause the rule's plain language, limited to material assets or liabilities, does not allow the court to redetermine maintenance, we decline to extend the rule to that situation."10
Despite this closely circumscribed grant of post-decree authority, CRCP 16.2(e)(10) contains its own ambiguities and uncertainties. Although the Rule restates the duty of each party "to provide full disclosure of all material assets and liabilities," "materiality" is never defined, leaving that determination to the subjective judgment of each party and, ultimately, the courts. "Full disclosure" under the Rule means accurate and complete disclosure; if either party's disclosure "contains misstatements or omissions," the district court "retain[s] jurisdiction" for a period of five years after the entry of a final decree "to allocate material assets or liabilities." However, the next clause of that same sentence refers only to "the omission or non-disclosure" of those material assets and liabilities, excluding the earlier reference to "misstatements" with respect to the court's continued jurisdiction to allocate those same assets and liabilities.
Additional uncertainties arise from the Rule's silence on how to define its terms. Given the anodyne, nonspecific reference to "misstatements or omissions" in a party's financial disclosures, the cause of the misstatement or nondisclosure, whether fraudulent, negligent, or innocent, is apparently legally irrelevant. If a party moving for post-decree relief under CRCP 16.2(e)(10) asserts that the other spouse "fraudulently" or "intentionally" misrepresented or concealed a material debt, asset, or associated value for either, the court would be indifferent to the assertion. Even attributing...
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